Mr. Babu Ram is engaged in the wholesale business of dry fruits. He imported 5,150 kg of almonds from California. Post importation, he did not clear…

CA Final · Indirect Tax Laws · MTP · May 2026
Mr. Babu Ram is engaged in the wholesale business of dry fruits. He imported 5,150 kg of almonds from California. Post importation, he did not clear them for home consumption but kept the imported almonds in a customs warehouse due to the renovation work going on in his retail store. Mr. Chunni Lal, the warehouse keeper, is of the view that titular rights of the almonds vest with him and Mr. Babu Ram has no access to them. However, Mr. Babu Ram wishes to inspect the goods and ensure that goods do not deteriorate during storage in the warehouse and thereafter, show them for sale to Mr. Bhim Sen. Which of the following statement(s) is correct in the given case as per the provisions of the Customs Act, 1962?
(A) The view taken by Mr. Chunni Lal is correct.
(B) The view taken by Mr. Chunni Lal is incorrect. However, Mr. Babu Ram can only inspect the goods.
(C) The view taken by Mr. Chunni Lal is incorrect. However, Mr. Babu Ram can only inspect the goods and ensure that goods do not deteriorate during storage in the warehouse but thereafter he cannot show them in warehouse for sale to Mr. Bhim Sen.
(D) The view taken by Mr. Chunni Lal is incorrect. Further, Mr. Babu Ram can inspect the goods and ensure that goods do not deteriorate during storage in the warehouse and also thereafter, he can show them in warehouse for sale to Mr. Bhim Sen.

Suggested Answer and Working Notes:

Correct Answer: Option (D)

The view taken by Mr. Chunni Lal is incorrect. Further, Mr. Babu Ram can inspect the goods and ensure that goods do not deteriorate during storage in the warehouse and also thereafter, he can show them in warehouse for sale to Mr. Bhim Sen.

Topics: Place of Supply

Open in Interactive Practice Hub · Full Practice Hub · Chapter Weightage · More in this subject

Related Questions in this Topic